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IMPACT – MEDIUM
What is the change? Australia has announced that it will provide Indonesian nationals travelling for tourism or short-term business with three-year, multiple-entry visas. Australia also plans to expand online visa lodgement to all Indonesians beginning 1 January 2017.
What does the change mean? The current visa validity period for Indonesians travelling to Australia is one year. Once the change goes into effect, Indonesians travelling to Australia for tourism or on short-term business trips will not have to renew their visas as often. The switch to online visa lodgement is also expected to improve the visa-application process.
Background: Australian officials framed the new visa arrangement as part of a broader effort to work closely with Indonesia to boost business and investment between the two countries. The new visas will be valid for three years for stays of up to three months per visit. The move to online visa lodgement follows a handful of pilot projects on electronic visa lodgement and should make the visa-application process easier.
BAL Analysis: Australian officials are hopeful that the visa changes will boost tourism, business and investment by Indonesians in Australia. The changes may also help set the stage for a renewed emphasis on developing stronger business and ties between the two countries.
This alert has been provided by BAL Australia. For additional information, please contact australia@bal.com.
MARN: 9683856
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IMPACT – HIGH
What is the change? The Ministry of Manpower signed a decree on Oct. 23 creating new guidelines that supersede and reverse several of the more restrictive immigration regulation changes that were implemented at the end of June.
What does the change mean? Indonesian authorities have removed recently imposed requirements regarding work authorization for business visits and for nonresident foreign directors, as well as foreign worker quotas.
Background: As BAL previously reported, Indonesian authorities enacted Manpower Regulation 16/2015 on June 29. In response to feedback from the international business community in Indonesia, Manpower Ministerial Decree 35/2015 was signed Oct. 23. The decree significantly alters the effects of Regulation 16.
Work authorization is no longer required for training, speeches or seminars, nor for meetings at the business traveler’s representative or branch office in Indonesia. However, business visas are still required when performing these activities in Indonesia. The following activities will require an IMTA of appropriate duration:
Furthermore, nonresident foreign directors and commissioners are no longer required to obtain an IMTA. Finally, the foreign-to-local ratio of 1:10 has also been removed as a requirement for companies employing foreign workers.
BAL Analysis: The easing of the requirement for work authorization for business meetings will make it simpler to conduct business activities in Indonesia again. The removal of the foreign worker quota and the requirement for foreign nonresident directors to obtain an IMTA will also lessen the burden of international companies that have branch offices in Indonesia or employ foreign workers in general. Indonesian immigration regulations are still undergoing intensive review by the relevant authorities and changes are possible without notice.
This alert has been provided by the BAL Global Practice group and our network provider located in Indonesia. For additional information, please contact your BAL attorney.
What is the change? Several changes to the procedures for hiring foreign nationals and the types of work permits to be obtained have been implemented in Indonesia under a recent regulation.
What does the change mean? The new regulation creates stricter rules and will result in longer processing times for employing foreign workers in Indonesia.
Background: The recent changes in the regulation are as follows:
BAL Analysis: The new regulations will have a major impact on businesses, who should anticipate additional inconvenience and costs. This is particularly true given the new requirements to obtain work permits instead of business visas for simple business meetings held in offices and the additional requirements for foreign workers on long-term assignments in the country.
This alert had been provided by the BAL Global Practice group and our network provider located in Indonesia. For additional information, please contact your BAL attorney.
IMPACT – LOW
What is the change? According to a new regulation, nonresident directors and commissioners of Indonesian companies who are living abroad may be required to hold work permits.
What does the change mean? Companies should note that it is unclear how this regulation will be implemented, as it appears to contradict other provisions, such as the requirement that work permit applicants hold a residential address in Indonesia. Further discussion and guidance from the Ministry of Employment is expected in coming weeks.
Background: The Ministry of Employment issued the regulation June 29, stating that foreign workers who are directors or commissioners of an Indonesian company (or foundation) and who are “domiciled abroad” may need to obtain a work permit sponsored by the entity.
BAL Analysis: As this is a new regulation that has not been fully worked out by local authorities, companies with nonresident directors affected by the regulation should work with their BAL attorney to determine their options while awaiting further guidance on how the Ministry will implement it.
What is the change? Under a new labor regulation, companies must have at least 10 Indonesian workers for every foreign worker employed.
What does the change mean? The previously unwritten policy is now subject to official regulation and enforcement.
Background: The regulation, issued by the Ministry of Employment, reinforces efforts to localize employment. However, companies do not have to observe the 10:1 ratio for expatriate employees who are working in temporary jobs, “emergency and urgent” jobs, or temporary positions in the fields of arts or sports. In addition, the rule does not apply to expatriate employees who are members of the board of directors or board of commissioners of an Indonesian company or who are members of the patrons, management or supervisors of a foundation (yayasan).
BAL Analysis: Indonesian companies should be prepared for possible increased scrutiny of their foreign work permits and labor force composition. BAL will closely monitor this new regulation and will provide updates to clients with any additional information or guidelines from authorities.
What is the change? Indonesia is currently discussing rules on language proficiency for foreign nationals applying for new work permits and expatriate workers applying for extensions.
What does the change mean? Until an official rule is announced, the Ministry of Manpower and Transmigration is recommending that foreign nationals who have been in the country for six months or longer undergo training to prove proficiency in the Bahasa language.
Background: The ministry recommends that foreign nationals who have been living in Indonesia for six months or more take language training and an examination. There is no official list of accepted language training courses. A proficiency exam is approximately two hours.
The language proficiency rules, which are expected to be announced in the coming months, could cover new and renewal work permit applicants or could set language proficiency standards for certain job levels.
BAL Analysis: Employers are advised to consider language proficiency training for foreign work permit applicants and expatriate workers already living in Indonesia who will be applying for extensions. This would reduce delays in the application and renewal processes in the event of a rule change imposing a new language requirement.
What is the change? Indonesia has begun limiting work visas to six months instead of one year for certain occupations.
What does the change mean? The positions that are affected include marketing advisors and quality control advisors, as well as engine installation and maintenance workers whose education and experience do not meet a certain level.
Background: On Feb. 1, Indonesian immigration authorities announced that they would no longer approve one-year duration work permits for foreign workers in certain business services, trade and consulting roles. Specifically, marketing advisors and quality control advisors will now be given work visas for six months. Engine installation or engine maintenance workers who have a high school education and less than five years of experience will be given work permits for six months, and those in the field with higher levels of education and more than five years of experience may be approved for one-year work permits.
Directors and managers are exempt and will still receive 12-month work visas.
Last month, we reported that foreign investment companies holding a principal permit, instead of a permanent license, are restricted to six-month work visas for foreign employees.
BAL Analysis: The limitations on work visas affect a small sector of foreign workers, and are an indication that Indonesia is taking steps to localize labor in certain industries and occupations.
What is the change? A new appointment system in Indonesia is leading to significant delays in the processing of applications for the Expatriate Placement Plan (RPTK), individual foreign employee approval (TA-01) and individual work permit (IMTA). Additionally, TA-01 applications have new documentation requirements. There have also been changes to validity periods for some work permits.
What does the change mean? Employers sponsoring applicants for the above permits must plan ahead and should expect delays. They should also be aware of the new TA-01 documentation requirements and new work permit validity periods.
Background: On Dec. 1, 2014, Indonesia switched to a new appointment system for RPTK, TA-01 and IMTA applications. Under the old system, hard-copy applications could be submitted one day after completing an online application. Now applicants must make an appointment online to set a date on which they submit their applications. Appointments are usually set at some point between one and three weeks after completion of the online application. In some cases, the wait can be as long as four weeks.
It is possible that wait times will decrease as officials continue implementation of the new system, but for now, employers and applicants should expect significant delays.
New documentation requirements for TA-01 applications have also taken effect. Beginning in November 2014, Indonesia began requiring that copies of university degree certificates, curriculum vitae and letters of reference be submitted with the sponsoring company’s stamp and a signature from the appropriate company HR or administrative official. Degree certificate copies, curriculum vitae and letters of reference also require a “materai,” stamp.
Finally, Indonesia has changed the validity period for certain work permits. Foreign investment companies holding a Principal Permit and not a Permanent License can only obtain work authorization for foreign nationals for six months. Company directors are exempt from the new requirement and can obtain work permits that are valid for a year.
BAL Analysis: The new application system creates significant delays in processing times. Applicants and their sponsors should build in as much as four extra weeks into their timelines. Employers must also be aware of the new documentation requirements and work permit validity periods in order to avoid needless complications.
What is the change? Indonesia has changed the rules on exit permits for foreign nationals who have completed their work assignments.
What does the change mean? Exit permits are now valid for seven days, requiring foreign nationals to leave sooner than in the past.
Background: Indonesia has shortened the validity period of exit permits for foreign nationals from 14 days to seven days. Exit procedures remain the same.
BAL Analysis: Foreign nationals should note that Indonesia is strictly enforcing the shorter exit period and that overstaying may result in monetary penalties.
What is the change? Indonesia has introduced more stringent endorsement and signature requirements for foreign nationals applying for work permits.
What does the change mean? Applicants will be required to provide additional stamps or endorsements when submitting curriculum vitae, education certificates and reference letters in support of work permit applications.
Background: The changes are the result of a new regulation. Documents subject to the new requirements include curriculum vitae, education certificates, and reference letters.
Curriculum vitae now require an official corporate stamp from the sponsoring employee, the applicant’s signature on each page, and an IDR 6,000 duty stamp. Education certificates must be stamped with an official corporate stamp, translated into Bahasa Indonesian or English, and accompanied by an IDR 6,000 duty stamp. Reference letters must be endorsed by a local sponsoring entity, stamped with the official corporate stamp of the employer, and accompanied by an IDR 6,000 duty stamp.
BAL Analysis: Employers should be prepared to gather and provide the required stamps and endorsements in order for their applications to be processed in a timely manner.